Seventeen schools were accused of colluding on financial-aid calculations; 10 now have agreed to settle By Melissa Korn Feb. 23, 2024 7:03 pm ET 2 Dartmouth will pay $33.75 million under the settlement. PHOTO: SCOTT EISEN/GETTY IMAGES Dartmouth College, Northwestern University, Rice University and Vanderbilt University agreed Friday to pay $166 million to settle a lawsuit that accused them and other schools of colluding to determine students’ financial-aid packages. They were part of a group of 17 highly selective institutions that were accused in 2022 of illegal price-fixing; 10 now have settled or formally agreed to do so. Dartmouth and Rice each will pay $33.75 million, Northwestern will pay $43.5 million and Vanderbilt will pay $55 million to settle the suit, according to filings made in an Illinois federal court Friday. The payments will be directed to a fund for students harmed by the alleged collusion. The colleges were allowed under a federal antitrust exemption to collaborate on aid calculations, but only if they didn’t take financial need into consideration when reviewing applicants. They also couldn’t discuss aid offers for individual students. The suit alleged that the schools did consider finances in some circumstances, for instance giving an edge to children of wealthy donors or when selecting candidates from their wait lists. The colleges worked together under what was called the 568 Presidents Group, a reference to the section of the 1994 legislation that provided the antitrust exemption. The arrangement allowed schools to avoid bidding wars for low-income applicants, but also limited how much they could favor wealthy applicants to keep scholarship spending to a minimum. The exemption expired in fall 2022, and the group dissolved that November. The University of Chicago agreed last year to settle the case for $13.5 million. Emory, Yale, Brown, Columbia and Duke universities filed paperwork in court last month, agreeing to pay a combined $104.5 million. A federal judge in Illinois approved the settlements earlier this month. Rice referenced a $33.75 million legal settlement in its fiscal 2023 financial report, though that hadn’t been confirmed in court filings until Friday. Vanderbilt said in a November filing that it reached “an agreement in principle,” but didn’t release financial details at the time. Northwestern will pay $43.5 million to settle the lawsuit. PHOTO: BRIAN CASSELLA/CHICAGO TRIBUNE/GETTY IMAGES The schools that settled earlier have denied wrongdoing, but said settling the case will avoid the distraction and expense of continued litigation. Representatives from Dartmouth, Northwestern, Rice and Vanderbilt didn’t immediately respond to requests for comment Friday. Seven others are still fighting the antitrust allegations: the California Institute of Technology; Cornell University; Georgetown University; Johns Hopkins University; the Massachusetts Institute of Technology; the University of Notre Dame; and the University of Pennsylvania. Plaintiffs’ attorneys said in a court filing that they expect to continue increasing the settlement amounts with each new agreement, to exert pressure on other defendants to move quickly or risk the prospect of paying even more. Plaintiffs’ attorneys said settlement funds will be distributed to all students in the proposed class, not just those who attended the schools that have settled so far. The proposed class includes about 200,000 members who were undergraduate students at the 17 schools going back nearly two decades. The latest settlements must still be approved by a judge.
Their risk here is potentially astronomical. Some of the elite universities have billions in their endowment. If you use the Alex Jones verdict as a precedent they could be completely wiped out.
What does that even mean? That fact is these universities are sitting on huge endowment funds. If they loose a lawsuit where they have to pay 50,000 people $50,000 that's only $2.5 billion. That amount of money is potentially actually recoverable from an institution with a 10 figure endowment. Do you really think some billionaire alumnus is going to hand over $2.5 billion of their own money so they don't have do lay anybody off from the underwater basket weaving program? Or that the people filing the lawsuit are too stupid to check where judges went to school? I predict they will all settle. Even a small chance of the plaintiff winning a huge award could catastrophic for them. Don't forget what happened with Oberlin college. https://lawandcrime.com/lawsuit/app...oberlin-college-for-false-racism-accusations/